With Med School At $278,000, Even Bernanke’s Son Carries Debt

Mark Moy came to the U.S. from China, paid his way through medical school at the University of Illinois in the 1970s and became an emergency room physician.

His son Matthew, a third-year medical student, has racked up $190,000 in debt and still has a year to go. Accrued interest on his medical-school loans has swelled his balance by 13 percent over three years.

“When I think about it, it will keep me up at night,” said Matthew Moy, 28. “I’m dreading the exit interview when I will find out exactly how much I’ll have to pay back.”

The next generation of U.S. physicians is being saddled with record debt amid a looming shortage of doctors needed to cope with a rising elderly population. The burgeoning debt burden may be turning students away from primary care, which pays about $200,000 a year, toward more lucrative specialties and scaring off low-income and minority students fearful of taking on big loans.

Median tuition and fees at private medical schools was $50,309 in the 2012-2013 academic year, more than 16 times the cost when Moy’s father became a doctor. The median education debt for 2012 medical-school graduates was $170,000, including loans taken out for undergraduate studies and excluding interest. That compares with an average $13,469 in 1978, said Jay Youngclaus, co-author of a February 2013 report on medical school debt. The 1978 amount would be about $48,000 in today’s dollars.

Bernanke’s Son
Even Federal Reserve Chairman Ben Bernanke’s son can’t expect to escape the debt burden. The elder Bernanke testified before Congress last year that his son is on track to leave medical school with $400,000 in loans. The figure may include accrued interest and undergraduate costs. His son attends Weill Cornell Medical College in New York, according to the school directory. Bernanke, through a spokeswoman, declined to comment.

The median four-year cost to attend medical school — which includes outlays like living expenses and books — for the class of 2013 is $278,455 at private schools and $207,868 at public ones, according to the Association of American Medical Colleges, a nonprofit group of U.S. schools.

Record numbers of students still want to become doctors. First-time applicants to U.S. medical schools rose to 33,772 in 2012 from 24,884 a decade earlier, according to AAMC. New enrollment at U.S. medical schools grew 1.5 percent to 19,517 students, the highest ever.

Doctor Shortage
The U.S. faces a shortage of more than 130,000 physicians by 2025 as the population ages and 32 million more Americans obtain insurance under health-care reform, the AAMC estimates.

Medical school is still worth the cost, said Cornell University President David Skorton, a cardiologist who took two decades to pay off his debt from college and medical school.

“The best investment I ever made was to borrow that money,” Skorton said in an interview. He received his medical degree from Northwestern University in 1974.

The majority of medical scholars — like most graduate students — finance their educations with loans. The interest rate on federal loans for graduate students is 6.8 percent for Stafford or 7.9 percent for Grad Plus, far higher than the benchmark U.S. 10-year Treasury note, which was 1.78 percent yesterday. Congress sets student-loan interest rates, which are typically higher than mortgages and car loans because they don’t require collateral and are given to borrowers who have no credit histories.

Interest Accrues
Interest on most medical-school loans continues to accrue on at least a portion of the balance during the multiyear residency period that students undergo after graduation if they don’t make full interest payments. That means a higher balance at the end of training, said Paul Garrard, president of PGPresents, an independent student-loan consulting company that specializes in medical debt.

A residency for internal medicine is three years. A specialty such as cardiology or nephrology can be another two to four years while neurosurgery is typically a total of seven.

David Lin, an anesthesiology resident at St. Barnabas Medical Center in Livingston, New Jersey, owes about $325,000. Because of accrued interest, the figure has risen 25 percent since he graduated from Chicago Medical School two years ago. He makes payments of about $450 per month.

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